OPERATING EXPENSES For the Year Ended June 30, 2024 (In Millions)
Operating Expenses The MDTA’s operating expenses include toll collection, law enforcement, maintenance, major repairs and replacements, administrative, depreciation, and pension. In 2024, operating expenses decreased by $0.4 million, or 0.1%, from 2023. The modest decrease was largely the result of a reduction in depreciation, that was almost fully offset by increases in other major expense categories including toll collections, police, maintenance, and insurance. Depreciation/amortization decreased by $17.3 million, or 8.8%, due to disposals and assets reaching the end of their useful life. The $2.9 million, or 8.8%, increase in pension expense is attributable to the MDTA’s allocated portion of the State’s pension costs. These decreases were partially offset by increases in areas such as personnel costs (cost-of-living adjustments and pay increments) and operations and maintenance costs (property and liability insurance). CURRENTLY KNOWN FACTS, DECISIONS, OR CONDITIONS The MDTA owns and operates a large and well- diversified system that provides essential transportation infrastructure links in a high-volume market with limited
Pension Expense $35.6 5.9%
Depreciation/ Amortization
Collection, Police Patrol, Maintenance $348.7 57.3%
$179.7 29.6%
General and Admin. $30.8 5.1%
Major Repairs, Replacements, Insurance $12.8 2.1%
competing facilities. The MDTA’s facilities include commuter travel routes and a portion of Interstate 95. The toll facilities have demonstrated low demand elasticity and are in affluent service areas that include the Baltimore and Washington, D.C. metropolitan statistical areas. Future traffic levels are generally impacted by trends in population, employment, income, gross regional product, inflation, and gasoline prices. The MDTA is aware of the following developments that will have an impact on the MDTA’s finances in the future. On March 26, 2024, the main spans and three approach spans of the Key Bridge (I-695) collapsed after a container ship struck one of the Key Bridge piers. The Key Bridge is part of the MDTA’s multi-facility tolling system, representing 7.4% of toll revenues in fiscal year 2023 (last full year of operations). Given its close proximity to the Fort McHenry (I-95) and Baltimore Harbor (I-895) tunnels, which serve as the two other Baltimore Harbor crossings, a portion of traffic has diverted to the two facilities. The Fort McHenry and Baltimore Harbor tunnels are also owned and tolled by the MDTA, and toll revenues are expected to continue to support operations through estimated bridge reconstruction in fiscal 2029. Given the ongoing partial traffic diversion from the Key Bridge to the other MDTA tolled tunnel facilities, debt service coverage is not expected to decline materially and MDTA is required to comply with the rate covenant set forth in its toll revenue trust agreement. The MDTA is partnering with State, local, and federal agencies in reconstructing the bridge. The costs associated with reconstructing the bridge are currently unknown. Funding for reconstruction may be derived from insurance proceeds and yet to be determined proportions of cash on hand, bond financing, and federal funds. The MDTA has received $350 million of insurance proceeds and anticipates continued Federal Highway Administration Emergency Relief Funding for the reconstruction of the Key Bridge of approximately 100% of federally eligible costs after use of remaining insurance proceeds. For additional Key Bridge information, see Note 12 and the toll revenue and transaction tables in the Other Supplemental Information section.
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